US President Joe Biden on Friday (June 1) addressed Americans in a rare Oval Office address that the debt ceiling bill that was passed by US Congress after negotiations that lasted weeks, has saved the country from an “economic collapse”. He was speaking from behind the historic Resolute Desk live on primetime television. Biden said that the deal was a compromise between the Democrats and the Republicans and that “no one got everything they wanted.”
“We averted an economic crisis and an economic collapse,” he said, adding that “the stakes could not have been higher.”
Biden said that he will sign the bill into law on Saturday. The bill authorises the government to extend the debt ceiling and paves way for new borrowing.
Watch | US Debt Ceiling: Biden and MCcarthy break the deadlock, debt limit suspended till January 1, 2025
The US Treasury Department had warned that if the debt ceiling was blocked beyond Monday, the country could default on its $31 trillion debt. A default would have likely triggered market panic, huge job losses and a recession, with global implications.
“Nothing would have been more catastrophic,” Biden said.
Addresses by the US presidents from the Oval Office have alsways been reserved for moments of unique national danger or importance.
A reassuring, calm Biden
Biden sprinkled his speech with chuckles and smiles as he spoke in calm and reassuring manner. He praised the Republican Party for negotiating in good faith. He promised Americans that he had never felt more optimistic.
Biden said that Congress has now preserved “the full faith and credit of the United States.”
Although the debt ceiling crisis has been averted, the US economy’s reputation has taken a hit. Ratings agency Fitch said Friday that it is keeping the United States’ “AAA” credit rating on negative watch, despite the deal.
The political tussle
This year, hard-right Republicans dominating their party’s narrow majority in the House of Representatives, decided to use the must-pass vote as leverage for forcing Biden into accepting cuts to many Democratic spending priorities.
This triggered a test of political strength that threatened to end in chaos before the two sides agreed this week on raising the debt ceiling while freezing some budgetary spending in return — yet stopping well short of Republican demands for cuts.
Kevin McCarthy, speaker of the Republican-led House of Representatives, chose to call the compromise bill a big victory for conservatives. However, he faced backlash from hardliners on the right accused McCarthy made too many concessions.
(With inputs from agencies)
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